The SEC and the Ministry of Justice indicted the creator of the little-known Blazar token
Date: 2023-08-24 Author: Karina Ziganova Categories: CRYPTO PAYMENTS, IN WORLD
The US Securities and Exchange Commission (SEC) filed charges on August 23 against John DeSalvo, the creator of a minor cryptocurrency called Blazar Token.
The agency said DeSalvo created Blazar Token in 2021 and raised $620,000 from 220 investors before the token finally crashed in May 2022.
DeSalvo was once a New Jersey Corrections Officer, and that fact was the key to his scheme. He allegedly advertised Blazar Token as a replacement for existing government pension systems and said that his token could be purchased through automatic payroll deductions. He targeted law enforcement and first responders as potential buyers and gained their trust through his status as a former corrections officer.
The SEC also claimed that DeSalvo guaranteed an extraordinary return on investment and falsely claimed that the Blazar token was properly registered.
The scheme ultimately resulted in DeSalvo misappropriating and misusing investor funds. The Securities and Exchange Commission said DeSalvo sent the misappropriated funds to his own cryptocurrency wallet and also used the funds to pay for bathroom renovations.
DeSalvo facing multiple charges
The SEC added that DeSalvo ran an earlier, unrelated scheme in January 2021. There, he targeted investors via social media and promised to invest their funds in stocks, options, and crypto asset securities. He allegedly lost nearly $17,000 of the $95,000 he raised and then embezzled the remaining $78,000. He falsely claimed that the securities had lost all value as a result of bad market conditions.
DeSalvo is currently facing charges of violating the anti-fraud and filing offerings provisions of the relevant securities laws. The US Securities and Exchange Commission (SEC) is seeking injunctive relief, forfeiture, pending interest, and civil penalties through its actions.
In parallel, the U.S. Attorney's Office for the District of New Jersey, an office within the U.S. Department of Justice (DOJ), also announced criminal charges against DeSalvo under both schemes. These charges include two counts of wire fraud, two counts of securities fraud and two counts of money laundering.
The allegations against DeSalvo add to a long and growing list of projects, companies and individuals that US authorities have cracked down on in recent years.
